For a homeowner, the idea of facing a situation in which a property tax lien becomes necessary probably doesn’t seem like the kind of circumstance that would lead to an entirely positive outcome or result in an uplifting story with any kind of frequency. David R. Gray, Jr., an attorney who is well versed in real estate investing, has encountered many uplifting stories throughout the course of his professional career and has seen firsthand why the property tax lien law is written and enforced the way it is.

It is worth noting that the state laws concerning property tax liens and county tax sales differ from state to state, but in most cases Gray points out that the laws are written to discourage properties from being forfeited by the original owner. In Illinois, for example, there is a window of at least two-and-a-half years in which the property owner can pay back the delinquent taxes to the owner of the tax lien, which ensures local government receives the revenue from the delinquent taxes while also providing a means through which the homeowner can pay back what is owed.

There have been countless stories in which homeowners have encountered a short-term financial difficulty leading to the inability to pay property taxes, but the subsequent sale of a tax lien to a private investor enables the homeowner to pay back the property taxes at an interest rate much lower than what would have otherwise been possible. In these scenarios, local government is able to avoid a budget deficit due to revenue shortfalls, investors are able to earn a modest return on their investment and homeowners are able to pay back what they owe at a fair rate of interest.